Supreme Court Rules Request for Admission was a Fraud on the Court

Requests for admission rarely get much attention, probably because of their limited value.  But the Supreme Court of Nevada ended 2016 by concluding an attorney used them to perpetuate a fraud upon the district court.

A request for admission cannot change undisputed facts of a case.

Plaintiff was driving on a highway that was within NRS 568.355’s definition of “open range” and struck Defendant’s cow.[1]  Plaintiff died as a result of the collision.[2]  NHP’s accident report noted the collision occurred on open range.  Plaintiff’s family created a website railing against open range laws, and then Plaintiff’s Estate sued the cow’s owner.  The owner answered and argued she was immune from liability, per NRS 568.360, because the accident happened on open range.  The Estate then served written discovery, including requests for admission.  One asked the owner to admit her cow was not on open range when the collision occurred.  Unfortunately, the owner’s lawyer did not respond, at all, to these requests.  The Estate then used this failure to respond as a basis to obtain partial summary judgment that the collision did not occur on open range.  This had the effect of eviscerating NRS 568.360’s open range defense.  The district court later entered a $1,294,041.85 default judgment for failure to respond.

What happened was owner’s lawyer was disbarred.  Owner eventually retained new counsel to attempt to set aside the default judgment.  New counsel filed a timely Rule 60(b) motion to set aside, “arguing that the district court should set aside the judgment because the Estate’s counsel committed a fraud upon the court when he sought and relied on the admission that the accident did not occur on open range.”  The district court agreed a fraud occurred and granted the motion.  It then granted the owner’s motion for summary judgment based upon NRS 568.360.

After resolving procedural questions, the Supreme Court addressed the Estate’s substantive argument: did the request for admission constitute a fraud upon the court justifying Rule 60(b) relief?

We have defined a “fraud upon the court” as only that species of fraud which does, or attempts to, subvert the integrity of the court itself, or is a fraud perpetrated by officers of the court so that the judicial machinery cannot perform in the usual manner its impartial task of adjudging cases.  An attorney is an officer of the court; as such, an attorney owes a duty of loyalty to the court, which demands integrity and honest dealing with the court.  And when an attorney departs from that standard in the conduct of a case he perpetrates fraud upon the court.  Even then, relief from a judgment based on fraud upon the court is rare and normally available only to prevent a grave miscarriage of justice.[3]

The Supreme Court conceded the default judgment probably would not have occurred but for the owner’s first lawyer’s inaction.  “Standing alone, that might not warrant relief, as the lawyer is the client’s agent and the acts and omissions of an agent ordinarily return to the principal who hired the faithless agent, not those who dealt with the agent in his representative capacity.”  The problem was how the Estate responded to the situation.  “[T]he Estate’s counsel seized on that abandonment as an opportunity to create a false record and present that record to the district court as the basis for judgment. Together, these acts and omissions merited relief.”

The Estate’s counsel breached his duty of candor to the court.  “Although counsel may request that the opposing party admit certain facts that counsel already knows or should know the answer to, if the opposing party fails to respond, we hold that counsel may not rely on the deemed admission of a known false fact to achieve a favorable ruling.”  Unanswered requests for admission may be a proper basis for summary judgment.  “However, counsel violates his duty of candor to the court when counsel: (1) proffers a material fact that he knew or should have known to be false, and (2) relies upon the admitted false fact to achieve a favorable ruling.”[4]  This was consistent with Conlon v. United States’ statement that requests for admission may not be used “in the hope that a party’s adversary will simply concede essential elements. Rather, the rule seeks to serve two important goals: truth-seeking in litigation and efficiency in dispensing justice.”[5]

Applied to the facts at issue there were at least three indications that the accident occurred on open range: 1) the owner’s answer; 2) the NHP accident report; 3) the website created by the decedent’s heirs themselves.  Despite that, a default judgment was obtained “based on the false premise that the accident did not occur on open range.”  The district court correctly ruled “the Estate’s counsel knew or should have known that the accident occurred on open range when he used the deemed admission to the contrary to secure a judgment for the Estate.”  This led to a rather painful summation.

[T]he Estate’s counsel’s duty of candor required him to refrain from relying on opposing counsel’s default admission that the accident did not occur on open range, when he knew or should have known that it was false, and that the district court did not abuse its discretion in finding the Estate’s counsel committed a fraud upon the court when he failed to fulfill his duties as an officer of the court with candor.

What does this mean?

I take four points from this opinion.

  1. Fraud is a big word in this context and not one to be used lightly.  The fact that the Supreme Court concluded that a fraud occurred on these facts should carry with it significant meaning.
  2. Requests for admission have limited use and may not be used to change what are effectively undisputed facts of a case.  All of the evidence indicated the collision occurred on open range.  Had there been some factual indication to the contrary, then the request for admission may have been appropriate, although I doubt it for reasons discussed in prior posts.
  3. Answering or objecting to requests for admission is immeasurably simpler than the tortured procedural history this case.  The accident report was from July, 2005.  The owner was only vindicated more than 11 years later.
  4. The “don’t punish my client for my mistake” argument is really, really dead.  I still hear it too often, but the reality is the client’s remedy is against their “faithless agent.”

[1] Estate of Adams v. Fallini, 132 Nev. Adv. Op. 81 (Dec. 29, 2016).
[2] There was no word about the cow’s fate, but my guess is there was lot of ground chuck to share afterwards.
[3] Internal citations and quotations omitted.
[4] Citations omitted.
[5] 474 F.3d 616, 622 (9th Cir. 2007).